Russia's Gazprombank plans subordinated perpetual Eurobond
MOSCOW, Oct 12 (Reuters) - Gazprombank, Russia's No. 3 lender by assets, has mandated banks to hold meetings with investors as it eyes a possible subordinated perpetual Eurobond offering, IFR and a banking source said on Friday.
Both said that Gazprombank, which is 35.5 percent owned by state-controlled gas company Gazprom , had hired Credit Suisse, Goldman Sachs, HSBC and Gazprombank itself to meet investors in Singapore, Hong Kong, Switzerland and London, starting from Oct. 16.
A subordinated perpetual bond, which in Gazprombank's case would also be callable and non-cumulative, would allow the bank to boost its capital, strengthening its ability to absorb possible shocks.
In a first deal of its kind in Russia, No.2 lender VTB
raised $1 billion via a perpetual bond issue in July this year, and is considering topping up the deal this autumn.
Gazprombank's Tier 1 capital adequacy ratio stood at 11 percent at the end of June, up from 9.6 percent at the end of last year.
Russian banks, their balance sheets stretched by rapid lending growth this year, are using bond or equity issues along with retained profits to improve their capital positions.
Last year, Russian state development bank VEB acquired a 10.2 percent stake in Gazprombank after buying the majority of a rights issue for about $1.57 billion.
Russian issuers, including the sovereign, have raised more than $38 billion via Eurobond deals so far this year, more than in the whole of last year, with new deals boosted by positive current risk sentiment.
A banking source told Reuters that Sberbank had mandated HSBC, JP Morgan, UBS and itself for investor meetings from Oct. 16. The source did not specify whether a deal may follow the meetings in London, Boston and New York.
(Reporting by Lidia Kelly and Katya Golubkova; Editing by Douglas Busvine and Susan Fenton)
((email@example.com)(+7 495 775 1242))
Keywords: RUSSIA GAZPROMBANK/EUROBOND